Inventory is low. Housing demand is high. It's a textbook example of a seller's market. But, when you add rising interest rates and home prices, many potential buyers are being squeezed out of the market.
What's Causing the Issue?
The housing market will always reflect the current economic status. The pandemic has directly affected our economy, and it impacted the housing market, too. It was more difficult to sell homes in 2020 and 2021 because of lost jobs, business closures, and quarantine. Fewer people wanted to purchase new homes, which created a buyer's market. Now, the opposite is happening. There aren't many houses on the market, and they're selling for well over the asking price.
What Can You Do?
What are your options now? It all depends on what you're looking to do. If you are looking to purchase your forever home and don't plan to move again, purchasing a house now (even with a higher price tag) may be a great choice. Interest rates are still historically low but are rising daily. If you act fast, purchasing your forever home is still an excellent financial choice.
On the other hand, your home is likely worth so much more than when you bought it. As home prices rise, your equity does too because your home has more value. You can take advantage of that equity with a cash-out refinance instead of purchasing a house.
Make Your House a Dream Home
Instead of settling for a home you don't love simply because it was the only one in your price range or with sellers that accepted your offer, take this opportunity to make your own home more comfortable. It might be wise to wait out the housing market for 2 or 3 years - by then, housing prices may have stabilized to a point where buying makes more sense.
Until then, you can use your equity, and a cash-out refinance to love your home now.
Ways to Love Your Home
- Install new flooring. Hardwood is still the favorite, but other options like engineered hardwood, vinyl planks, and laminate are less expensive, easy to install, and much easier to clean than hardwood.
- Build a deck. Creating outdoor spaces will make your backyard more enjoyable. Just check with your Homeowner's Association before you begin building. Some HOAs have certain rules you'll have to follow.
- Update your bathroom. Make big changes like a new vanity, or start small by replacing your faucet, showerhead, or toilet.
- Replace your roof. If your roof is more than 15-20 years old, it might be time to replace it. While asphalt shingles are still the most common, other options include metal, slate, rubber, and solar tiles. All have their pros and cons, so do your research!
- Add privacy fencing. Creating a private backyard will provide a great return on your investment. If your HOA doesn't let you build a fence, look into shrubbery or trees to get that privacy.
- Replace old appliances with something more eco-friendly. In the past ten years, most appliances have been built to be greener and use less electricity. If your major appliances (fridge, stove, washer & dryer, dishwasher, etc.) are on the older side, you'll see a major improvement on your electricity bill once you replace them.
- Add built-in storage. A great way to add personality and storage is with built-ins. Make a reading nook with a bookshelf. Create hidden storage under a bench. Add cubbies to your mudroom for coats and shoes. The possibilities are endless!
- Update outdoor walkways with stone or brick pavers. By defining a walkway in your front or back yard, you can immediately elevate the look of the space. This is also a great way to increase curb appeal.
- Add wainscotting. Wainscotting is timelessly popular, but it also makes cleaning much more manageable. Use a durable paint finish (like semi-gloss or satin) to make wiping down your walls quick and easy. Wainscotting is great for mudrooms, bathrooms, and playrooms.
- Install crown molding. It may seem like a simple addition, but it's powerful. Adding crown molding to your ceiling immediately makes the room feel more complete.
- Purchase trees to plant in your yard. Older trees are more expensive than seedlings, but the impact is enormous. Adding mature trees to your yard creates shade and character.
Quick Quality of Life Updates
- Update light fixtures
- Reorganize your bookcase by color
- Update countertops with a DIY kit
- Frame your bathroom mirror
- Update cabinet hardware
- Plant a garden
- Put up a new backsplash
- Repaint the exterior of your home
- Add a smart thermostat
- Repaint any room in your home
- Add a gallery wall or art that makes you happy
- Refresh dining chairs with new upholstery
- Paint your front door
- Add a large area rug to an otherwise bland room
Keep in mind that any significant updates you make to your house will increase the value even more. This means that when you're ready to sell your home, you'll get top-dollar for it. Plus, you will have enjoyed the remaining years in your home.
To find out which option is best for you, contact one of our loan officers today. They can discuss your current mortgage and whether purchasing or refinancing makes the most financial sense today.